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KVA as capital (Why KVA? (in economic terms KVA functions as capital,…
KVA as capital
Why KVA?
in economic terms KVA functions as capital, different from other reserves
Calculation
Stability
Other capital criteria
Process of
Definition of capital per Regs
Enable us to win more deals & grow PBT
Structuring
Flow
Ask
incentives in recognition of the capital nature of KVA
Whats the benefit to the group?
PBT growth
Additional deals in struct and flow for Trdng desk
Process for inclussion
Manual adjustment to the capital done through the Performance measurement process
KVA is over and above credit reserves ( CVA)
PV of cost of capital (CCR& CVA) over the life of the deal
Available to absorb default losses at a GM level and therefore Group